The COVID-19 pandemic has been characterized by an understandably frustrating series of stops, starts, and surges. Particularly for business travel, the challenge of safely returning to the road while mitigating ongoing threats from COVID-19 has been a yearlong exercise in risk management.
For businesses looking to plan their comeback though, the indicators ahead are largely positive. Thanks in part to accelerated vaccination timelines, increased travel demand, and a recovering economy, a full-scale rebound is now in progress. Here are the encouraging signs of a changing travel landscape ahead.
Greater Availability of Vaccines
Vaccines have long been touted as the most effective way to achieve herd immunity. However, even as communities and scientists around the world came together to develop vaccine solutions in record time, the challenges of supply and the logistics of distribution loomed not far behind.
Now, with three vaccines approved for emergency use in the U.S. and actively in distribution, both the supply of vaccines and the paces of vaccinations is increasing. In fact, nearly 1 in 3 adults are partially or fully vaccinated and projections show that much of the U.S. population will be fully immunized by summer. Other countries are following suit, including Canada which is experiencing an influx in vaccine supplies after an initial lag.
This news should help grow the confidence of travelers returning to the road, particularly since recently released CDC data indicates that vaccinated individuals cannot carry the virus. In addition to safeguarding travelers from catching or spreading COVID-19, it also provides an increased comfort level in the new travel environment. This is especially important since travel procedures and restrictions may have changed significantly since the last time many travelers hopped on a plane or rented a car.
Increasing Travel Volume
As the supply of vaccines has grown, so has the volume of travel. From hotel occupancy ticking upward to airlines adding new routes, signs of growth abound.
For the airline industry, pent-up demand is leading projections of profitability in the near future. According to Delta’s CEO Ed Bastian, the booking window has expanded considerably from the compression that characterized much of 2020 and sustained momentum will lead to profitability by September. To further aid in the recovery, the American Rescue Plan passed last month has protected thousands of airline workers from the risk of furloughs or layoffs. The resurgent optimism of the airlines can be seen in the flurry of recent announcements regarding resumed routes and new destinations across the board.
Travelers seem to share this optimism based on recent numbers. TSA recently had its busiest day in over a year, with more than 1.5 million passing through security checkpoints at the tail end of March, and multiple surveys have found consumers eager and willing to travel again. This is true for business travelers as well, nearly half of whom indicated that traveling for work improves their mood and provides motivation.
Hotels have witnessed the return of these travelers, as occupancy levels begin to ease past their pandemic lows. According to CBRE, hotel occupancy levels should grow to 55.1 percent by the end of the year, up 12 percent from the beginning of the 2021.
Easing of Travel Restrictions
As travel increases and the vaccine distribution picks up steam, COVID-related restrictions are changing accordingly.
International borders, many of which have been closed for more than a year are now easing constraints for vaccinated travelers. Iceland, Greece, Thailand, and Singapore are just a few of the countries that have reopened or announced plans to reopen their borders to travelers who can provide proof of vaccination. In most cases, this means skipping the process of pre-trip testing and avoiding traveler quarantine at the destination.
New COVID-19 testing solutions have also been rolled out to bridge the gap until vaccination rates increase on a global scale. A recent Oxera-Edge Health report concluded that cheaper and more easily administered antigen tests can safely be used as an alternative to PCR tests, providing test results as quickly as 20 minutes. This mean less waiting for travelers and fewer expenses for businesses.
Preparing Your Travel Program
While the signs of travel growth ahead may look different depending on your business size and needs, all indicators point to an industry in rebound. As we’ve shared before, those who are able to safely get their employees back on the road first will experience “first-mover advantage.”
Working with Direct Travel as your preferred travel management partner, we can evaluate key aspects of rebuilding your corporate travel program. From travel policy updates and risk management solutions to sourcing and negotiations, we can help you formulate a gameplan to get your business back in front of key contacts and accounts. Contact us to get started.